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THE WHITE HOUSE
Office of the Press Secretary

For Immediate Release

October 30, 1998

REMARKS BY THE PRESIDENT
ON THE ECONOMY

The South Portico

11:16 A.M. EST

THE PRESIDENT: Good morning. I want to say a few words
today about the growth of our economy and important new steps we're
taking to strengthen that growth as we move toward the new century.
Six years ago, our economy lagged behind the rest of the world, so we
changed course, with a new strategy for economic growth founded on
fiscal discipline and lower interest rates. It has worked.

It has helped to produce an American economic
renaissance with low inflation, low unemployment low welfare rolls,
rising wages, the highest rate of home ownership in history, the
first balanced budget since Neil Armstrong walked on the Moon, and
the smallest federal government since John Glenn orbited the Earth.

This morning's economic report shows that our economy is
continuing to grow in a strong manner, at a solid 3.3 percent. It is
continuing to expand opportunity, to create wealth, to lift the hopes
of working families. In the face of worldwide economic turmoil, our
economy remains the strongest in a generation. But to keep it going
we must stay with the strategy that created the conditions of this
enduring economic expansion, and we must address the challenges of
the global economy. I'd like to say a word about both.

First, we must maintain our fiscal discipline. I have
insisted we preserve our hard-won surplus until a plan is in place to
strengthen Social Security. We stopped the Republican Majority in
the House from squandering the surplus in an election-year tax plan.
They haven't given up, however. House Republican leaders have
reaffirmed their desire to spend the surplus before we have a plan in
place to save Social Security. And the Republican leader in the
Senate now says he may not even work with me on saving Social
Security.

On Tuesday the American people will choose a Congress
that will decide whether and how to save Social Security for the 21st
century. I believe the American people need a Congress that is 100
percent committed to preserving that surplus until we Social Security
first.

Second, to strengthen our economic growth, we must
continue to invest in and improve the quality of our people's
education. The budget I signed last week invests in after-school
programs and makes a strong down payment on 100,000 teachers to lower
class size in the early grades to an average of 18. But the Congress
refused to build or modernize 5,000 schools. I believe that was a
mistake as well.

We need a new Congress to correct that error and
modernize our schools. If we're going to have more teachers with
more students in smaller classes, they have to have someplace to
meet.

A stronger American economy also depends upon a stronger
international economy. Growth at home increasingly depends upon
growth abroad. Our economy increasingly depends upon exports, and
many, many of our exports go to emerging markets. Those markets now
are faltering. A full quarter of the world's markets, the world's
population, now live in countries with declining or negative economic
growth. This presents to us the biggest financial challenge in a
half century.

Over the last year we have pursued a comprehensive
strategy to fight the financial crisis and protect American jobs at
home as well. Last month I outlined a set of specific actions to
spur global growth. In the weeks since, we've been working with our
G-7 partners and with those in the emerging markets to make
significant progress toward that goal.

Think what's happened in the last month. Japan has
committed substantial resources to repair its banking system. The
European Union has joined the G-7 in recognizing that the balance of
risk has shifted, and that above all, now, we must spur growth. The
U.S., Japan, Canada, and several European nations have cut interest
rates. America has met its obligations to the International Monetary
Fund. This week Brazil announced a program to tackle its fiscal
problems. And President Cardoso has assured me that he will
implement the program swiftly.

To build on that progress, Prime Minister Blair of Great
Britain and I have been working to rally support for several new
measures to help strengthen the international community's ability to
keep financial turmoil at bay. Secretary Rubin and Chairman
Greenspan have been deeply engaged with their counterparts in the
effort. And over the past week I've been speaking to other G-7
leaders about it.

Today I'm pleased to report that the world's leading
economies have linked arms to contain the financial turmoil that
threatens growth not only in emerging markets, but in all markets of
the world. The leaders of the major industrial economies have taken
the following steps. This morning they've released a statement
outlining our common agenda.

First, we have agreed to establish a new precautionary
line of credit, anchored in the IMF, to help countries with sound
economic policies ward off the global financial crisis in the first
place. With substantial new resources at the IMF, this line of
credit gives us a powerful new tool that can be used when it will do
the most good at the lowest cost, before the trouble starts.

Second, we have also agreed to establish a new World
Bank emergency fund to provide support in times of crisis to the most
vulnerable members of society and to encourage the World Bank to
leverage private sector investments in countries now affected by the
crisis.

And finally, even as we act to contain the crisis, we
are building a modern framework for the global markets of the 21st
century. Today we released detailed plans for greater openness and
stronger standards for finance in the international marketplace. And
we have agreed to ask our finance ministers to make new and very
concrete recommendations to help to tame the excessive volatility in
financial markets that can destroy hope and diminish wealth.

These steps are very, very important. Over the long
run, if America's economy is to continue to grow, the economies of
our trading partners must continue to grow. In a larger sense, if
America's devotion to freedom and openness is to be met with success,
we must put a human face on the global economy for the most
vulnerable people in the emerging countries when they face hard
times.

So I feel quite good about what my fellow G-7 leaders
and others have done here. I thank them for their support. I thank
especially Prime Minister Blair for his support.

Now, let me say, finally, for all of us here at the
White House, this is not just a day of good economic news; it is
personally a day of sad news because this is Erskine Bowles' last day
as Chief of Staff. Sometime this afternoon, while I am in New York
working, he is going home to North Carolina.

I want to say again how much I appreciate the
indispensable role he has played in balancing the budget and
developing sound economic policies, in improving our commitment to
education in ways that will affect millions and millions of
schoolchildren, and in his conviction that we were doing the right
thing to pursue our race initiative.

Finally, he has been a marvelous role model for the
young people who worked at the White House and for the not so young
as well, putting us together into a team, getting everyone to work
together, thinking every day about what good can come from our common
efforts.

As all of you know, he is a very close personal friend
of mine. I will miss him very much. But most of all today, I want
to acknowledge his contributions to the people of the United States.

Thank you very much. (Applause.)

Q Mr. President, do you think voter turnout will be
affected by the impeachment issue?

THE PRESIDENT: The answer to your question is, I don't
know. I know that this is no ordinary election, no ordinary time.
What is at issue are big things that will affect every American and
every American family's children. What is at issue is the future of
Social Security, whether we will have a patients' bill of rights for
the over 160 million people in managed care plans, whether we will
continue to advance the cause of education by building and
modernizing our schools, whether we will continue the path of reform,
raising the minimum wage, passing campaign finance reform, protecting
our children from the dangers of tobacco. Those are the big issues.

I hope every American will go and vote, and vote in good
conscience, and vote on what is important to this country and its
future. All I can do is tell the American people, I know this is no
ordinary time, no ordinary election, and they need to vote. I have
no prediction about what the turnout will be, but I am confident that
if people understand the stakes, it will be quite impressive.